Attorney General charges Credit Suisse in Bulgarian money-laundering case

Credit Suisse said it rejects the allegations about supposed organizational deficiencies and intends to defend itself vigorously. Keystone / Urs Flueeler

Following a 12-year investigation, the Swiss prosecutor has indicted the country’s second-largest bank for failing to take sufficient measures to prevent money laundering by a Bulgarian criminal gang.

In addition to Credit Suisse, indictments have been filed with the Federal Criminal Court against a former bank manager and two members of the criminal organisation, the Office of the Attorney General announced.

In a statementExternal link on Thursday, it said the bank is accused of “failing to take all the organisational measures that were reasonable and required to prevent the laundering of assets belonging to and under the control of the criminal organisation”.

The criminal group, which was established by a top athlete from Bulgaria, was involved in international drug trafficking and large-scale money laundering of proceeds. These proceeds were allegedly paid into bank accounts in Switzerland controlled by the criminal organisation from 2004 until 2007.

The investigation, which was opened in 2008, found that procedures for opening and monitoring accounts by the bank’s employees and superiors didn’t comply with the anti-money-laundering provisions in force or the bank’s internal directives. The compliance process was “flawed” according to the prosecutor’s office.

The prosecutor also alleges that Credit Suisse’s procedures for freezing bank accounts were “dysfunctional” and had failed to prevent the flight of assets amounting to the equivalent of around CHF35 million ($39.6 million). This happened after the Attorney General issued a seizure order in August 2007.

In a statement, Credit Suisse wrote it was “astonished” to learn of the indictment. “The bank rejects the allegations about supposed organisational deficiencies and intends to defend itself vigorously,” it said. It is also convinced that its former employee is innocent.

The bank risks a fine of up to CHF5 million.